Broadband Service Better, Faster in Japan - Japanís Success Story

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According to the article in the Post, Japanís geography and demographics are part of the reason for its broadband success. Japan is a very small country, especially when compared with the US, and it is densely populated, with most of its people living in cities. It also had to do some significant rebuilding after World War II, including some serious rewiring with newer copper cable. Add these factors together, and you get shorter loops on more capable wire than you find in many places in the US; both of these factors lead to greater speed and presumably cheaper connections.

But it didnít stop there. In 2000, Japanese regulators passed laws that forced phone companies to open their lines to Internet providers. At that time, Japanís Internet system was slower and more expensive than what was available in the US. Under the new regulations, new broadband companies could rent bandwidth on an NTT copper wire connected to a Japanese home for only $2 per month. This made it economical for them to charge only $22 per month for a DSL connection that was faster than most of the broadband services available in the US.

Then an ambitious company head saw his chance. Masayoshi Son, head of Softbank, began offering broadband that was six times as fast as NTTís. He marketed it by sending young people out in the streets to distribute free modems that connected users to the service. As a result, the company saw its share of broadband service in Japan skyrocket in five years from zero to more than one-third. So the price of broadband in Japan continued to drop, while speeds kept going up.

Since they now had to compete with other providers, Nippon Telephone and Telegraph (NTT) began building out fiber-optic lines to homes, with the help of government subsidies. As a result, nearly nine million homes in Japan have fiber optic lines Ė almost nine times the US number. ďObviously, without the competition, we would not have done all this at this pace,Ē notes Hideki Ohmichi, NTTís senior manager for public relations. To say these lines are fast is an understatement; users of fiber can reach speeds of up to 100 megabits per second, about 17 times as fast as the best rates you can get on cable in the US.

NTT owns and controls almost all of the new fiber lines into homes. Fiber connections to the Internet are growing faster than DSL. Before too long, all of Japan will be using fiber connections for phones, television, Internet, and many other services. Of course, this growth in fiber has NTTís competitors insisting that the government compel it to open those lines as well.